Health plan payment in the Netherlands

This chapter describes the institutional setting, design, and performance of health plan payment in the Netherlands. The primary focus is on the Health Insurance Act (2006), which is based on principles of regulated competition and strongly relies on health plan payment as a tool for achieving public objectives. In anticipation of the introduction of regulated competition, the construction of the current health plan payment system started in the early 1990s. More than two decades later we conclude that important progress has been made. We also conclude, however, that further improvements are necessary. Two main issues of the current system are the remaining incentives for risk selection and the strong dependence on endogenous variables in the risk equalization model. Incentives for risk selection threaten the solidarity, efficiency, and quality of care, while endogenous risk adjustor variables threaten efficiency in the delivery of care. Further improvements to health plan payment are crucial to overcome these potential failures.

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